Coca-Cola Company Struggles with Ethical Issues
Many of the ethical issues surfaced when Warren Buffet resigned in 2006 and Doug Ivester took over. Ivester lacked leadership and as a result, the company faced many ethical issues. Ivester tenure was symbolic in that it was short-lived. This was a serious public relations glitch for a company who for so long, performed flawlessly. Ivester was replaced by Doug Daft, the former president and chief operating officer. Unfortunately, Daft had no success in derailing the controversies. In early 2000, Coca-cola was embroiled in ethical scandals such as racial discrimination, misrepresenting market test and manipulating earnings.
Text Questions 1. Why do you think Coca-Cola has had one ethical issue to resolve after another over the last decade or so? In 2000, Coca-Cola failed to make the top ten of Fortune’s annual “America’s Most Admired Companies” list for the first time in a decade. Many believe this was a direct result of the contamination scare in June of 1999. 30 Belgian kids became ill after consuming Coca-Cola. Rather than come out right away and defends its product, Coca-Cola took several days to respond. I believe that as a result of this global crisis, Coca-Cola panicked and spiraled out of control.
This company was operating on a high level for a decade and to be hit with such a scandal rocked the foundation the core. 2. A news analyst said that coca-cola could become the next Enron. Do you think this is possible? I do not believe that this case is similar to Enron. Enron’s culture was one of greed and win-at-all-cost mentality. Enron leadership created an atmosphere of invincibility. This was evident by the “rank-and-yank” system implemented to rid of those who were rated at the bottom 20 percent. This forced employees to engage in questionable practices in order to maintain their standing within the company.